This is Business Law. 1. In a limited partnership how many general partners must
ID: 352348 • Letter: T
Question
This is Business Law.
1. In a limited partnership how many general partners must you have at a minimum and how many limited partners must you have at a minimum?
2. In a limited liability company can you have just one owner in all 50 states? What is a risk when you start a limited liability company with 1 owner?
3. In a limited partnership who gets the profits?
4. Who in a limited partnership is responsible for the losses and debts if the business cannot pay? Who in a limited liability company is responsible for the losses and debts if the business cannot pay?
5. In a limited liability company who gets the profits?
6. In a limited liability company who gets to make the management decisions?
7. In a limited partnership how are management decisions made?
8. In a limited partnership what can partners contribute other than money as their capital contribution?
9. Do all partners in a limited partnership have to work in the business to get a share of the profits and losses?
10. Do all members in a limited liability company have to work in the business to get a share of the profits and losses?
11. Who is responsible for paying the taxes for profits in a limited liability company? In a limited partnership?
12. Do you need to register with a state or states if you are a limited partnership? If you are in a limited liability company?
13. What happens to a limited partnership if the only general partner dies?
14. What happens in a limited liability company if one of the members dies?
15. What happens if one of the partners wants to leave the limited partnership or LLC business – can they, and do they need the permission/agreement of the remaining partners?
16. Are general partners in a limited partnership automatically entitled to at least minimum wage or a salary of some kind because they work in the general partnership business? Are members who work in a limited liability company entitled to at least minimum wage or a salary of some kind because they work in the business?
17. Does the term “joint and several liability” for your partners’ actions apply in a limited partnership?
18. Do general partners in a limited partnership have any liability to their limited partners if they make decisions in the business that are harmful to the partnership business – can they be sued?
19. Can one member of a limited liability company make a decision without the consent of the other partners?
20. Can one of the members in a limited liability company be “forced out” against their will?
21. State at least three reasons owners in a limited liability company or a limited partnership should enter into a “buy-sell agreement.”
Explanation / Answer
In limited partnership, you must have at least one general partner and one limited partner. In a limited liability company, one person can start a company and can be as ingle owner in all states. But, the risk of single owned limited liability company is lack of uniformity that is LLC treated differently in different states as well as self-employment tax has to be paid by the owner. In a Limited Partnership, profit is shared among both general and limited partners but losses are not shared by limited partners as they don’t take part in the day to day working of the company. In a Limited partnership, losses are to be bear by general Partners as they are responsible for day to day operations of the company. In a Limited Liability company, partners decide on their own on how and how much the profits are to be distributed among them. They can allocate according to the need of the owner. Limited Liability Company is owned by members, some are managing members while some are just members. Different members have different rights which is defined in company’s operating agreement. According to that, decision making power is distributed.
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